Ched Ltd manufactures Cheddar cheese pies. For January 2022, it budgeted to purchase and use 15 000 kg of Cheddar cheese at £0.89 per kg; budgeted output was 60 000 pies. Actual purchase and use for January 2022 was 16 000 kg at £0.82 per kg; actual output was 60 800 pies.

Required

1 Calculate the flexible-budget variance.

2 Calculate the price and efficiency variances.

3 Comment on the results in requirements 1 and 2.